December 2004 Archives

By Al Bredenberg

A news item that appeared on TMCnet on Dec. 29, 2004, provides some fascinating insights into Intel Corporation’s vision of the future digital home:

Intel Boosts Investment in the Digital Home

The release tells about three companies recently added to the list of companies receiving investment from Intel Capital, the chip manufacturer’s venture capital arm. The three companies, Gteko Ltd., Synacor Inc. and Zinio Systems Inc., each received funding under Intel’s Digital Home Fund initiative.

In explaining the purpose of that fund, Intel’s Web site quotes John Miner, vice president and Intel Capital president: "As more entertainment and educational content becomes digital, people want to edit, manage and access that content and share it among multiple devices including TVs, stereos, PCs and handhelds. The Digital Home Fund is designed to complement Intel products and accelerate development of key technologies and content which enhance and simplify the digital home experience."

A look at each of these three unique companies gives clues into Intel’s product strategy for home digital technologies, and the company’s thinking about what the future holds for IP communications in the consumer space.

Gteko Ltd.

Gteko, an Israeli company, has developed suites of products and services that address the enormous problems consumers have with setup, maintenance, networking and troubleshooting for home computing products. For example, Gteko offers a Self-Healing Suite that replaces the human administrator with an automated system that constantly checks and monitors a home computing system, identifies problems and offers automatic fixes.

Intel’s press release refers to Gteko’s Home Network Suite, which automates network functions, such as first-time setup of a home network. The mention of home networking in Intel’s press release suggests to me that Intel has recognized reliable networking as a crucial technology for the future of the digital home, but one that requires better solutions – thus the funding of Gteko.

I can personally testify to the support and usability problems associated with home networking. I’m an advanced computer user and have been working with personal computers for over 20 years, but I still have incredible frustrations resulting from the repeated failure of my home network. If IP communications are to make significant progress in people’s homes, networking is going to have to become easy, seamless, invisible – a non-issue. My bet is that Intel is betting on Gteko to help make this happen.

Synacor Inc.

Intel describes Synacor as “applying the cable TV business model to the Internet,” bundling premium Web content from many sources so a branded content package can be offered by ISPs to their customers through one integrated portal.

To me this indicates Intel’s recognition of the possibilities for making money from Web-based content. So ISPs, Intel would say, need to go beyond merely providing the pipelines for consumers to access the Internet – they also need to become providers of private-label content-related services and applications that add value for customers beyond the basic Internet access service.

From a personal perspective, my gut response to this idea is that I am well enough aware of how to get access to the Web content and services I need and am capable of doing my own consolidation. So I am unlikely to value this kind of service as a user and would probably not make use of it even if my ISP offered it for free. But I can see that the average consumer might value having someone available to find and filter various content sources and act as middleman for access and settlements for premium content.

However, that’s assuming the current situation, in which Web and TV content sources are delivered separately. But once Internet, television, music, audio, games, data, voice and other services begin to be delivered via one converged IP platform, it could become much more valuable to have prepackaged services vetted, acquired, organized and delivered by a knowledgeable middleman or syndicator, who’s able to make it all happen in an easy, usable way.

Zinio Systems Inc.

Zinio is a digital magazine publisher that has so far delivered online over 26 million digital versions of over 200 popular magazine titles. That’s not to say that nobody’s buying paper magazines anymore, but with the increased costs of paper and postage, digital publishing is a good alternative for publishers, especially for reaching overseas audiences.

Here at TMC, we have begun publishing Customer Inter@ction Solutions and Internet Telephony in digital format, with more titles to be rolled out soon. In less than two months, digital subscriptions have already reached about 10,000 combined. (Go here to find out how to subscribe.)

I’m pretty sure that Intel is investing in Zinio in recognition that the spread of broadband access is going to make it increasingly feasible for consumers to download digital publications. As reading devices such as ebook readers, tablet computers, and electronic paper improve, consumers will likely become more accustomed to reading on devices and will become less tied to conventional paper. Also, electronic publications allow for interactivity in ways not possible with paper, as well as integration with multimedia content, which will become increasingly available over converged IP networks.

So it seems to me that these new investments by Intel indicate where the company sees communications heading in the near future. The company feels that it is valuable to support the products, services and companies that are helping to bring about converged communications on the PC-based platforms for which Intel provides so much of the key technology.

Intel Capital plans more investments in a similar direction in the near future. Intel’s statement quotes Scott Darling, Intel Capital vice president and director of Enterprise and Digital Home sectors: "We plan to continue to invest next year in companies that enable PC and CE devices to work together easily and in companies that deliver premium content services over IP networks."

AB -- 12/30/04

While I'm on the topic of 'The Top 10 This or That for 2004,' (see Most-Used IM Acronyms from earlier today) this release also came through today:

America Online Announces 2nd Annual 'Top 10 Spam Terms'

AOL's top 10 spam subject lines for 2004 were:

1. "We carry the most popular medications" (Vioxx appeared often)
2. "You've been sent an Insta-Kiss!" (phishing/ID theft scam)
3. "You Have 17 New Pictures" (phishing/ID theft scam)
4. "STEAMY HOT LESBIAN ACTION LIVE ON CAMERA!"
5. "All orders are shipped from authorized locations" (re: online medications)
6. "2005 Digital Cable Filters"
7. "F R E E* 30 Second Pre-Qualification MORTGAGE Application"
8. "HURRY HURRY Hot Stock on the RISE"
9. "Sale PRICES ARE BEST ONLINE!"
10. "Breaking news on the Top Pick stock"

Some of those do look familiar!

AOL says that the character of spammers has changed over time. The company describes the newer spammers as "sophisticated, nefarious, shadowy, devious, deceitful, sneaky, malicious, and -- unfortunately -- dedicated .... Gone are most 'small-time' spammers, and what is left are the 'hardcore, kingpin spammers.'"

AB -- 12/29/04

Were you ever confused about an acronym somebody used in an IM or SMS message? A little help appears in this release from today:

Omnipod Releases New Survey Results of Most Commonly Used Instant Messaging Acronyms in the Workplace

Here are the top 10 revealed in Omnipod's survey:

1. NP -- No Problem
2. JK -- Just Kidding
3. LMAO -- Laughing My A** Off
4. CB -- Call Back
5. TTYL -- Talk To You Later
6. WTG -- Way To Go!
7. NCIH -- No Chance In Hell
8. DHT$ -- Don't Have The Budget (or Dollars)
9. WRUV4 -- Who Are You Voting For?
10. RFL? -- Ready For Lunch?

Omnipod is a company that provides an enterprise communications platform based on IM technology. "It is interesting to see how IM slang evolves year after year," CEO Gideon Stein says in the release. "People seem to be getting more comfortable in their general use of IM as a conversational medium with more and more slang entering their acronym use -- LMAO and NCIH are prime examples."

AB -- 12/29/04

It's been just about 10 years since I started using the Web as a medium for business and marketing. At that time, I approached some of the great marketing gurus to ask them what they thought about online marketing. Here are some of their comments:

"I don't have time to surf the web."
-- Top Commercial Copywriter, ca. 1995

"The Internet? Nah!"
-- Top Direct Marketing Publisher, ca. 1995

Both of them now have Web sites. One of them publishes an email newsletter and a blog and has written at least two books about online marketing. The other has an article on his site called "22 Rules for Internet Success."

Stories from the past couple of days emphasize to me the growing importance of the online medium as a sales channel. I heard both stories this morning on National Public Radio's "Morning Edition," but the story about Amazon.com also appeared yesterday on our TMCnet Web site:

Amazon.com's Tenth Holiday Season is Best Ever; Consumer Electronics is Biggest Category for the First Time in Company's History

I think it's interesting that, while many retailers are bemoaning the slow holiday season, Amazon is booming, 10 years later. And don't forget that 10 years ago the Net-bashers thought Amazon's Jeff Bezos was doomed.

The other story I heard on NPR this morning was about online music retailer CDBaby, which carries the CDs of over 80,000 independent musicians and groups -- no distributors allowed. The company keeps $4.00 from each CD sold and has sent over $11 million to artists since 1998.

Go here to listen to the "Morning Edition" program: CD Baby Finds Success in Online Music Niche

By far the greatest volume of music today is sold on CD, but the direct download music business is growing and will probably overtake the CD medium eventually. But in the meantime, CDBaby is a great example of the ability of the Internet channel to empower people to market their own products and services in new ways.

AB -- 12/28/04

Today we received some comments by email from Allen G. Pitts, media and public relations manager for the American Radio Relay League (ARRL), in response to a news release that appeared on our TMCnet Web site:

Internet America, HILCO & Amperion Announce Strategic Partnership to Offer Broadband Over Power Line Service

I should point out that this was not an article by TMCnet but a press release submitted to our site by Internet America or one of its representatives.

I thought it would be worthwhile to quote out Pitts's comments as a kind of "op-ed" on the BPL issue:

"In your recent article on Broadband over Power Lines (BPL) "Internet America, HILCO & Amperion Announce Strategic Partnership to Offer Broadband Over Power Line Service," there were many claims made. Such sweeping statements may have a place in the marketing information of the BPL manufacturers, but there is another aspect of BPL that is not mentioned in the press release: radio interference. ARRL, the National Association for Amateur Radio, has participated in testing in a number of the BPL marketing trials and has seen interference to radio reception in each of the sites their staff and volunteers have examined. In many cases, BPL proponents pronounce their marketing trials as being “successful,” but to ARRL’s knowledge, no BPL trial has included a thorough examination of interference issues, so it is premature to pronounce these tests to be a success.

"Even Chairman Powell of the FCC, one of the most vocal proponents of BPL, admitted the seriousness of the interference issues. Simply put, there is no way that radio frequency signals are going to stay contained in a wire designed to carry normal electric power. It will radiate and pollute the radio spectrum. The FCC’s October 2004 Report & Order recognized this danger to communications and totally barred the BPL companies from using frequencies associated with aeronautics and other governmental agencies. Obviously, these concerns about interference and spectrum pollution were not seen as trivial or resolved by the FCC. For the rest of the radio community, there is the FCC promise that if a licensed system experiences harmful interference due to BPL in the area, the BPL provider must either fix it in a timely way or shut their system down.

"Your article also did not address the reverse problem of interference to BPL by licensed, legally operating radio systems. Since BPL will be using radio frequencies, it is likely that BPL service will be slowed or even stopped by radio transmissions in the area. Tests have been done by Amateur Radio operators that show that even a few watts of transmitter power nearby can cause the BPL system to temporarily stop working.

"Amateur Radio Operators are not against BPL. In fact, hams have historically been one of the first groups to adopt new technologies and possibilities. What the amateur operators and many other radio user groups are so concerned about is the pollution of wide areas of the radio spectrum by interference from BPL. And, when it comes to radio interference, who would YOU listen to: the FCC and experienced radio operators, or your local electric company?"

For more information about why many amateur radio users are concerned about the deployment of BPL, you can visit this page at the ARRL Web site.

AB -- 12/23/04

As a guy who uses a laptop a lot, I was a little worried about the report that came out of SUNY Stony Brook claiming that the heat from a laptop can reduce fertility in men. I first learned about the study in an article from Time Magazine, "Too Darn Hot!"

We don't expect to have any more children, but I still hate to think that I might be simmering the stew for too long. I'm sure other men (especially younger ones) are equally concerned.

So it was timely that this news item appeared yesterday: New Gadget Prevents Laptop-Induced Infertility in Men; X-Files Actor Invents Patented Solution

What adds an interesting angle to this story is that the inventor of the new Chill Pak is geek icon Dean Haglund, who played Langly, one of the Lone Gunmen trio on the X-Files TV show.

As far as I can tell, the product is basically just a big flat freezer-pack that sits under your laptop to absorb the heat. But if it cools the codpiece, it has my blessing!

Telecommunications analysts from Merrill Lynch today released a report highlighting plans from three companies to upgrade their access networks to deliver video to homes. BellSouth, BCE and Manitoba Tel (MTS) are all involved in Fiber-to-the-Node (FTTN) projects and are working intensively to get in-ground construction taken care of in anticipation of market demands for video service.

Below are some notes about each of these providers and their plans. The Merrill Lynch report is private and restricted, so all I can really link to is information made public by the companies themselves

BellSouth

For an interesting analyst presentation provided by BellSouth, see this PDF.

For new construction, BellSouth is rolling out Fiber to the Curb (FTTC); most households (16.3 million) get Fiber to the Node. The company has not specifically committed itself yet to delivering terrestrial video, but it obviously realizes the importance of this service if it is to remain competitive.

BellSouth is evaluating ADSL2+ technology for video delivery and is trialing Microsoft’s IPTV platform. Merrill Lynch quotes BellSouth Chief Staff Officer Mark Feidler about IPTV: “The fact that there is a switched architecture gives us an ability to differentiate the product … but first and foremost, it’s got to work.” Sounds right to me.

MTS (Manitoba Tel)

Unlike BellSouth, MTS is already providing DSL TV and had signed up 30,000 subscribers by November 2004, 17% of its homes.

Here’s where to find information about MTSTV.

Merrill Lynch analysts say about the MTS TV business: “We believe that the standalone economics of this business are challenging.” But not impossible, apparently. Even though the costs of network upgrades and individual installations are high, the operation should reach break-even in earnings in 2005, if I understand correctly.

BCE (Bell Canada)

Here’s a pretty thorough press release from BCE outlining its plans in the IP communications space.

According to Merrill Lynch, BCE is pursuing a multi-pronged strategy for its access network and video services, delivered via a mix of satellite, FTTP and FTTN (using IPTV). BCE expects to reach about half its homes with this upgraded network by 2008, about 4.3 million homes, most of which are single-family and small multi-unit residences; these will receive ADSL2+ technology delivering bandwidth of up to 26Mbps.

One thing I would have to say from the point of view of a small business user, knowledge worker and consumer: All I really want is a fat pipe coming right to my house and my place of business so I can send and receive massive volumes of data and communications seamlessly and effortlessly, whatever application or device I’m using. That’s all, really. I get impatient when I hear about the square-peg-into-round-hole contortions of the various telecoms to get the infrastructure and networks in place to make this happen.

Of course, they are businesses after all, and whatever they do has to be feasible and profitable. Maybe I just need to be more patient and have confidence that it will eventually happen ….

AB -- 12/22/04

Two interesting news items showed up today related to mining the blogosphere, that is, getting a higher-level view of what's important in the space:

Bacon's Cuts through the Blog-Clutter; New Service Mines the Blogosphere for Relevant Content

In January 2005, Bacon's is adding blog analysis to its MediaSource product. A Bacon's honcho says, "With today's information overload from often irrelevant or dubious sources, our aim is to help our clients by filtering the communications clutter." Sounds interesting, no? Downside: Bacon's MediaSource service starts at $2,495 per year -- ouch!

Johnny Depp, "Fahrenheit 9/11'' Captured Bloggers' Attention in 2004, Intelliseek Finds; BlogPulse.com Year-end Review Examines Entertainment Trends in Blogging

The BlogPulse offering is more fun than Bacon's, especially since you don't have to pay for it. The site includes top blogs and posts for 2004, plus the top mentions of books, movies, celebs and more.

One comment I would make is that these two offerings represent very different views of blogspace. BlogPulse views it as an amazing collective communications environment to be explored for knowledge, pleasure, and human connections. Bacon's seems to view it as a vast trash heap to be picked-over for the occasional gem.

Which approach seems more valuable? Depends on your goals, I guess.

AB -- 12/22/04

For a minute last week, media attention focused on the FCC's proposal to allow in-air cell phone calling on airplanes. Here's a press release from the FCC on the plan:

FCC to Examine Ban on Using Cellular Telephones on Airborne Aircraft

FCC Chairman Michael Powell rightly gave assurances that any FCC decisions would be made in cooperation with the Federal Aviation Administration (FAA) and would take into account precautions "against interference to onboard communications and navigation equipment."

But Commissioner Michael J. Copps (while applauding the plan to increase communications options for air passengers) expressed the concern many of us have about allowing in-flight cell phone usage: "Many airline passengers don’t relish the idea of sitting next to someone yelling into their cell phones for an entire six hour flight. I know I don’t!"

In a world where peace and quiet is getting harder to come by, I can understand and share this reservation. However, I'm not confident that a continued cell phone ban is going to sustain the quiet environment of air flights in the long run. The reason I say this is that broadband Internet access will soon be available on airplanes, and the accelerating convergence and development of voice-and-multimedia-over-IP technology will likely make it possible soon for users to carry on VoIP calls and even video conferences during air travel, even if they can't use cell phones in transit.

See this release on Boeing's Connexion service, now in trials.

If what you're looking for on air flights is a respite from noise pollution, I'm doubtful whether there's going to be much protection, even if cell phones remain banned.

Maybe airlines will introduce the "Cone of Silence" from the Get Smart TV show, as a requirement for people who want to call out during flights?

Probably not. The most likely protection lies with the desire most of us have to be courteous and maintain good relations with our neighbors. Cell phone communications don't require nearly as much shouting as some users think they do. And instant text messaging can be a good option for real-time communications that don't annoy others -- except perhaps for the incessant clicking of keys!

AB -- 12/20/04

Yesterday my colleague at TMCnet, Johanne Torres, wrote about Verizon's plans over the next five to six years to switch over its network nationwide from PSTN to IP:

First Town in Verizon Nationwide VoIP Conversion

Also yesterday, TMC President Rich Tehrani called my attention to an article by Jim Duffy with some higher-level analysis and explanation of Verizon's strategy.

Verizon has received acclaim for its Fiber to the Home (FTTH, aka Fiber to the Premises, or FTTP) efforts.

The concept and intent behind FTTP seems to me like an incredibly important movement. So I've been wondering what plans are in the works from the incumbent RBOC I'm handcuffed to, SBC Communications, to implement FTTH. For the past 10+ years as a home Internet user, I've yearned for decent bandwidth that allows me to really converge. I finally gave up on SBC's DSL service about a year ago, as I was disgusted with their poor customer service and inattention to problems with my account. (Note: This was a back-office/call center problem -- the real telephone guys who come to your house are great.) So now, Comcast is my Internet provider, and I much prefer the cable access I have now.

My friend Chuck (not his real name -- don't want to get him in trouble) is an SBC field supervisor, so I asked him what SBC's plans are for FTTP. Am I going to get fiber into my house sometime soon? Chuck's reply: "Not gonna happen." According to him, SBC plans FTTH only for new construction -- retrofitting to existing homes is too expensive.

Searching the SBC Web site, I found this news release:

SBC Communications to Detail Plans for New IP-Based Advanced Television, Data and Voice Network

From what I gather from this release, SBC indeed only plans real FTTP for new construction. For existing homes, they plan an alternative called Fiber to the Node (FTTN). Here's some more detail about that, from the release:

"In existing neighborhoods, or 'overbuild' situations, SBC plans to use an FTTN architecture, which on average takes fiber to within 3,000 feet of homes being served and makes use of advanced compression technologies along with IP switching to deliver high-quality TV, Internet access and voice services. FTTN is capable of delivering 20 to 25 megabits downstream, sufficient to simultaneously deliver four streams of TV programming, including HDTV and Internet access with robust speeds, and IP voice--all on a common IP network platform.

"While the two architectures support the same services and deliver many of the same capabilities and benefits, the company expects that FTTN deployment can be completed in one-fourth the time required for an FTTP overbuild and with about one-fifth the capital investment.

"By the end of 2007, the company expects to reach 17 million households with FTTN technology and nearly 1 million with FTTP."

So that holds out some hope, even for us poor slobs who don't plan to build new homes anytime soon. But am I one of the 17 million FTTN winners? And can I really wait up to three years for SBC's FTTN rollout? And am I eager enough for convergence that I will be willing to hold my nose and go back to SBC and its unresponsive customer service?

Not if somebody else can get fiber to my home sooner! Any takers?

Al B. -- 12/15/04

Saw the following scary report today:

Anti-Phishing Working Group Announces Phishing Attack Sites Increased by 29% In November; Report Shows Smart Malcode Is Augmenting Social Engineering Phishing Attacks

This report mentions the involvement of organized crime in phishing scams, which somehow I had not heard about, although it doesn't surprise me. Until recently, I had been getting a fair number of phish spams -- several every week, anyway.

Now, however, the anti-spam system I use can filter out fraud spams as well as the garden variety of spam. I use Cloudmark's SafetyBar, formerly SpamNet. SpamNet is actually not just a software product -- it's a P2P network of over a million spam fighters who collectively identify and filter out spam. Although it has its downsides, it's still my favorite anti-spam tool, and I recommend it.

-- Al B. -- 12/15/04